Naixue’s tea (02150. HK), the first share of new tea drinks, was listed in Hong Kong today with an opening price of HK $18.86 and an IPO price of HK $19.80. The day before the opening, it was up 11% in the dark market. As of 12:00 noon, Naixue’s share price was at HK $17.6, 11.11% lower than the issue price, with a total market value of HK $30.186 billion.
Since the opening of its first store in Shenzhen at the end of 2015, Naixue’s tea has developed rapidly in the past six years and now has about 560 stores in more than 70 urban areas. From 2018 to 2020, Naixue’s tea revenue was 1.087 billion yuan, 2.502 billion yuan and 3.057 billion yuan respectively, with a compound annual growth of 67.7%.
With the listing of Naixue, the value of the founders Zhao Lin and Peng Xin has soared. According to the current stock price, the couple’s value is nearly 20 billion Hong Kong dollars. According to the data, the total share capital of Naixue company is 1.715 billion shares. Peng Xin and his wife control 64.1% of the voting rights of the company and hold 977 million shares (57%). Peng Xin and his wife are worth 17.2 billion Hong Kong dollars.
As the exclusive investor of Naixue’s round a and round a + tea and the leading investor of round B, Tiantu capital has also become a big winner of this listing. It is reported that at present, Tiantu is the largest institutional shareholder of Naixue, holding 11.18% of shares, with a market value of HK $3.375 billion. The company participated in three rounds of investment, with a total investment of only 381 million yuan (equivalent to HK $458 million). It took Tiantu capital four and a half years to float more than six times.
It is worth noting that Naixue company has introduced five cornerstones to subscribe for a total of 60.705 million offering shares, accounting for about 23.60% of the offering shares under the global offering and about 3.54% of the total issued share capital immediately after the completion of the global offering. UBS fund, huitianfu fund, Guangfa fund, Nanfang fund and Qianyuan Fuxing invested US $155 million in total. However, with the listing on the first day, Naixue fell sharply, and all cornerstone investment was in a loss on the first day.
According to the prospectus, Naixue’s tea issued about 257 million shares this time, and the IPO raised a total net fund of HK $4842.4 million. According to the plan disclosed by Naixue, 70% of its fund-raising will be used to expand the store network and improve the market penetration in the next three years. In addition to replenishing the enterprise’s operating capital, the other 30% will continue Naixue’s key strategy in recent years, which will be used to strengthen the company’s supply chain and digital intelligent technology, and further improve the overall operation efficiency.
Profitability has always been one of the core data of Naixue. According to the prospectus, although the customer unit price is more than 40 yuan, Naixue has been in a state of loss for a long time. In 2018, 2019 and the first three quarters of 2020, the net loss of Naixue was 69.7 million yuan, 39.7 million yuan and 27.5 million yuan respectively, and the accumulated loss in three years exceeded 130 million yuan. But in the fourth quarter of 2020, Naixue finally began to turn losses into profits. According to the latest prospectus, after adjustment, Naixue will achieve a net profit of 62.17 million yuan in 2020. However, its operating cost pressure is still very high. In addition to the rental cost, the raw materials and labor costs of Naixue tea account for 40% and 30% of the total expenditure respectively.